KUWAIT CITY: “Al Ahli Bank of Kuwait (ABK) increased its net profits from KD 35.4 million to KD 37.6 million in 2014, after taking provisions of KD 42.4 million,” disclosed ABK Chairman Talal Mohamed Redha Behbehani during the ABK Ordinary Annual General Meeting (AGM) on Saturday at its head office in Kuwait City.
Behbehani outlined that total assets at year-end stood at KD 3.5 billion, 9.7% growth compared to KD 3.19 billion in 2013, with total deposits increasing by 11.5% from KD 2.6 billion to KD 2.9 billion in 2014. Shareholders’ equity rose to KD 558 million and earnings per share rose from 22 fils to 23 fils.
During the Annual General Meeting, the distribution of 13% cash dividend (13 fils per share) for the financial year ended 31 December 2014 was approved.
In the UAE branches, Abu Dhabi had another excellent year and ABK expects this growth to continue into 2015 and beyond. Dubai achieved strong loan growth, which will provide the foundation for enhanced financial performance in 2015.
“We focus on providing quality products and services to our customers whether in Kuwait or through our overseas branches in Dubai and Abu Dhabi,” stated Behbehani.
During the event, Behbehani cited the major achievements of ABK in 2014 such as the increase in operating profits to KD 82.5 million; ABK maintained a capital adequacy ratio of 23.7%, which is the highest among the local commercial banks and ahead of international peers; it reduced its NPL ratio from 2.6% in 2013 to 2.5% in 2014 and improved operating efficiencies, which resulted in a stable Cost to Income Ratio, comparable with other banks. He added that total provisions against the cash and non-cash facilities amounted to KD 169.7 million, with NPL coverage of 232%, which provides sufficient coverage for any future contingencies.
ABK has also won three awards from “Banker Middle East” for its performance such as the Best Premium Credit Card -2014, Best Web/Mobile Site – 2014 and Best Prestige Debit Card – 2014.
“Our vision is the simplification of our banking services, and our strategy is to differentiate ABK by providing customer-friendly services and rapid turnaround times, which will help us increase our customer base and capture additional market share particularly where we are witnessing banks from the GCC, and other countries, working at establishing a foothold in Kuwait and gaining ground at the expense of the established local banks,” stated Behbehani.
He added that they are putting in place a strategy that will feature caution and pragmatism, but which will also give ABK the flexibility to capitalise on emerging growth opportunities.
“Such a process will necessarily involve some degree of cultural change, and we also anticipate a likely return to simpler banking practices and an exit from activities which are peripheral to the core business,” he pointed out.
Behbehani cited that ABK maintained its credit ratings issued by Moody’s and Fitch – and its investment grade status with a ‘Stable’ outlook. Moody’s affirmed ABK’s A2/Prime-1 long and short-term deposit ratings and Fitch affirmed ABK’s Support Rating Floor at A+.
During the AGM, Behbehani also tackled the bank’s Corporate Social Responsibility platform. “ABK strongly believes in the importance of giving back to our community. Therefore, we are committed to supporting various activities and social events to encourage community initiatives. As part of our CSR program, we focused on education and launched a number of initiatives with the goal of honoring and supporting outstanding students to help them complete their research and modeling projects, essential to their graduation,” he informed.
He added that ABK also supported a number of international days, and to encourage others to participate in social responsibility, they carried out health campaigns such as Blood Sugar Orientation Day and Blood Donation Day.
“During the Holy Month of Ramadan , we ran an extensive campaign which included the distribution of care packages to under-privileged families,” he cited.
In conclusion, Behbehani stressed that overall ABK is well positioned to benefit from any uplift in the economy expected in the future once the political and economic conditions improve.
“The Bank is strongly capitalised and has one of the highest capital adequacy ratios. We have strong liquidity that enables us to utilise the potential opportunities in the future, and finance the mega government projects to develop the infrastructure in electricity and oil fields in addition to financing the private sector projects,” he concluded.